The Business Model Canvass

Researchers have looked into the functionality of business planning and a reduction of the working elements into useable models. One of the most revolutionary tools for startup business modeling is the book, “Business Model Generation” by Alex Osterwalder (see the Harvard Business Review link for greater detail). The book gives detail of how to use a business model canvass to develop your business model. In summary, the business canvas is an operation outline that group 9 separate business segments into one-page model. The segments of the canvass are:

Key Partners

Key Activities

Key Resources

Value Proposition

Cost Structure

Customer Relationship

Channels

Revenue Streams

Customer segments

As you can see, the segments of the business model canvas are part of the list of business model sections above. Each segment has it’s own quadrant within the canvas. Within the quadrant there are a series of hypotheses about each segment as it pertains to your business model. Through testing these hypotheses, you develop the individual components of your business model. The benefit of the canvas is that it provides a one-page, operational overview of the business. The critical aspects of the business that are listed under each segment allows for continued strategic analysis of the operations.